Lord & Taylor is bankrupt.
After months of speculation, the struggling department store chain as well as its parent company Le Tote today became the latest fashion players to file for Chapter 11 bankruptcy protection — in the U.S Bankruptcy Court in Richmond, Va. Bloomberg News first reported the move this evening.
Lord & Taylor, which was acquired by Le Tote less than a year ago, has been on the bankruptcy watch list for some time, so the filing isn’t a surprise. In the past few months, JCPenney, Neiman Marcus and J. Crew have filed for bankruptcy as the coronavirus crisis hit footwear and apparel players hard — and stores shut down for months.
But even before the pandemic emerged, all of the retailers found themselves in precarious positions as consumers shifted online and debt loads increased significantly.
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In April, Lord & Taylor saw the bulk of its executive team resign, including president Ruth Hartman. In addition, Le Tote confirmed it had implemented “significant company-wide layoffs” across both Le Tote and Lord + Taylor “with only key employees remaining to preserve the business.”
Before announcing its intention to sell Lord + Taylor to Le Tote for $75 million last August, previous owner Hudson’s Bay Company had struggled for some time to revive the mid-tier department store chain amid declining comps. (Also part of the Le Tote-Lord + Taylor merger was a secured promissory note for $CA33.2 million, or $25 million, after two years.)
HBC, which sealed the deal on its own go-private plans in January, memorably shuttered Lord + Taylor’s 100-year-old flagship on New York’s Fifth Avenue in 2019, closed another 10 of its 48 stores and dabbled in a number of omnichannel initiatives, including an unlikely digital partnership with Walmart in 2018.
This is a developing story. Check back for more.